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Around this curve, another train wreck waits for Colorado

By Dustin ZvonekGuest Commentary

Posted:
06/25/2014 12:38:07 PM MDT

Updated:
06/26/2014 06:07:19 PM MDT

CSX Transportation coal trains sit in a rail yard in Printer, Ky. New regulations on carbon emissions proposed by the Obama administration have reportedly angered politicians on both sides of the aisle in energy-producing states such as Kentucky and West Virginia. (Luke Sharrett, Getty Images)

Optimism is an admirable virtue, up to a point. It can become a potential vice, however, when crossing over into naiveté, which is something we've seen a lot of following the latest move in President Obama's one-man climate crusade.

Colorado's search for silver linings became almost comical a few weeks back, after the Environmental Protection Agency unveiled onerous new rules that may regulate away the state's primary power provider (which still happens to be coal). Eternal optimists and Obama apologists gushed about how well-prepared Colorado is to cope with the new rules, because we're supposedly ahead of the curve on embracing renewable energy mandates and began an aggressive (but still controversial) coal-to-gas switch several years ago.

But here are a few sobering points for silver lining-seekers to ponder.

While it's true that Colorado's been "ahead of the curve" in politicizing energy policy, by requiring certain utilities to meet renewable energy production quotas, Coloradans have also paid for those feel-good policies with some of the steepest energy rate increases in the country. You just can't force a wholesale changeover from one energy source to another, or favor expensive energy over affordable energy without hitting people in the pocketbook. Xcel's latest rate hike request, totaling $137 million, offers ample proof that there's a high price to pay for chasing politically correct energy fads. And the price tag will only climb if Obama isn't stopped.

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Being "ahead of the curve" in centrally planning the energy sector, and "ahead of the curve" in imposing unnecessary cost hikes on unwary energy consumers, is nothing to cheer, since this places new strains on everything from family budgets (especially for the poor and working class) to the business sector's bottom line. Colorado's cost of living will soar, and its economic competitiveness decline, as a result of such policies.

We still don't really know how much higher our utility bills will climb in order to meet existing state renewable standards, since, as with most such schemes, the most painful and costly benchmarks are delayed years into the future. Now we don't just have state mandates to meet, but federal mandates too. Anyone believing this will be cheap or easy probably also thought Obamacare would be "affordable."

And being ahead of the curve on green energy fads won't necessarily make it easier to meet Obama's benchmarks, contrary to the spin, because Washington, in its infinite wisdom, is demanding much deeper cuts from states that have diversified energy portfolios, like Colorado, while cutting slack for states that rely more heavily on high-carbon coal. Coal-centric Wyoming, for instance, must make a mere 19 percent cut, while ahead-of-the-curve Colorado faces a 35.4 percent cut. Inflicting disproportionate pain is an odd way to reward Colorado's ahead-of-the-curve energy attitudes. But shouldn't we by now expect such absurdities from arrogant incompetents in Washington, who've done such great work "fixing" health care that it's now the energy sector's turn?

Although there is disagreement about the exact number of jobs that will be killed as a result of these new rules, there's wide agreement that it will cause Americans to lose jobs. On the low end, the EPA estimates that somewhere between 56,000 and 80,400 full-time jobs will be lost by 2025, while a recent analysis conducted by the U.S. Chamber of Commerce concluded that some 224,000 jobs will be lost per year through 2030.

This seems like folly at a time when the economy is still digging itself out of a ditch. And the impact on Colorado's economy will be even more significant, and maybe even severe, given that this is still the 11th largest coal-producing state in the country.

Here's another inconvenient truth to consider: Roughly 60 percent of Colorado's electricity continues to come from coal-fired power plants. Prematurely closing those plants, under orders from President Obama, creates a yawning energy deficit we'll somehow have to fill. Backers of this plan owe Coloradans a detailed plan for how they'll fill that gap, and who will pay how much to do so.

Despite the serious impact that Washington's new energy rules will have in Colorado, we don't hear a word of protest from the state's Democrat-dominated leadership. Apparently, they're willing to let Coloradans get hammered by higher energy costs rather than confront the President with the implications of what he's doing.

Being ahead of the curve is fine, assuming you know with certainly what's around the corner. Sometimes rounding a curve, while moving too fast, doesn't result in open road, but in a wreck. The same applies to reckless regulating as reckless driving.

Zvonek is state director of Americans for Prosperity-Colorado. Write him at dzvonek@afphq.org.

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